Budget 2017: The economic figures you need to know

Chancellor Philip Hammond will be delivering the Autumn Budget today at around 12.30, just after Prime Minister’s Questions. He is expected to introduce measures with the aim to “invest and secure a brighter future” for a “Global Britain”, but looming economic and political uncertainties are painting a challenging backdrop.

A stalling engine

Productivity, as measured in economic output per worker and per hour, has remained at roughly the same levels as in 2008.

The independent Office of Budget Responsibility is expected to “significantly” lower its productivity estimates, which entails weaker output, reduced tax revenues – and less manoeuvring room for the chancellor.

The Institute of Fiscal Studies (IFS) estimates that the lukewarm productivity growth will result in a public finances loss of up to £20bn when compared to previous estimates.

“The forecast for productivity this time around is likely to be more pessimistic than in March – that means slower wage growth, slower economic growth and lower tax receipts which will mean higher borrowing,” said the IFS.

A rock and a hard place

Meanwhile, the International Monetary Fund (IMF) has predicted UK growth to slow to 1.7% in 2017 and 1.5% in 2018.

And despite unemployment being at the lowest point since the 70s, real wages have been falling against rising prices. This October, inflation stood at 3%, while average wages grew by 2.2% in September – the difference partly owing to a falling pound leading to higher cost of imported goods.

Moreover, the Office of National Statistics (ONS) recently reported a fall in employment figures, with the number of people employed falling by 14,000 in the July to September period, to approximately 32 million – suggesting that the employment boom may be coming to a head.

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